B. of A. cut CEO's salary by more than half in 2008

GregMorcroft

NEW YORK (MarketWatch) -- Bank of America Corp. paid Chief Executive Ken Lewis $10 million in 2008, which is less than half of the $24.8 million he earned in 2007, according to a Securities and Exchange Commission filing Wednesday.

Lewis' 2008 pay included $1.5 million in base salary, $4.3 million in stock awards and $3.1 million in stock option awards.

The salary also included $854,256 for the change in pension value and deferred compensation, along with "other expenses" of $275,125, Bank of America
BAC, -0.08%
said.

The executive's "other expenses" included $220,267 for use of corporate aircraft, as well as $13,791 for home-security services.

Lewis -- who along with other top banking-industry executives has come under withering criticism over compensation, perquisites and client-marketing expenditures -- defended the firm's practices in a speech last week in Boston.

"I completely understand the outrage that people feel when they hear of banks that lost money paying out large bonuses to top executives. I believe in pay for performance. That's why, given the decline in our 2008 earnings -- even though we earned more than $4 billion -- we paid no year-end incentive compensation to members of our executive management team, including me," he said.

Bank of America shares have fallen 80% over the last 12 months.

Lewis said he and his management team wouldn't leave the company over pay issues, but that the impact of pay caps is felt farther down the leadership ladder. "When artificial caps are extended down into the organization, they hit associates who are not part of executive management, but whose compensation reflects very high revenue production. We could lose these associates to a foreign bank or an investment boutique that is not operating under the same restrictions. Such a loss hurts our company and our shareholders." See full story.

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